l1-h1 conversion (queries on extension and h1b approval)

My hubby has l1 and I am on l2 visa. Our visa and I94 would expire by sept 24 2014.

We both are trying from h1b and few consultancies say that we would be out of status by sept 24 hence are not ready to apply h1 for us. I am not understanding what they mean?

Also My hubbys employer is planning for l1 extension and again this is not sure. The consultancy says if l1 extension is applied after filing for new h1b then USCIS would consider the latest one,so h1b would get rejected. Is this true?